How cement industry contributes to Tanzania’s national economy

IT is undisputed factor that the cement industry sector contributes to the development of the important infrastructural facilities needed to speed up economic development of any country in the world, Tanzania included. Cement product is more useful to enable the construction go on. Cement in its raw form technically has no ability, but it is the key ingredient for making concrete as well as the foundation of any construction purposes. Concrete is used more than any other man-made material and is second only to water as the most used consumer good, not only in construction but in all walks of human life.
For the Tanzanian economy to grow, IT needs infrastructure development through the construction of major means of transport such as roads, bridges, railways as well as main telecommunication network towers. All these infrastructural development requires cement product. Other important features are such things like residential properties, commercial buildings, hospitals, fibre optic cables, service centres etc. are also important for national development. In 2007, Tanzanian industrial production comprising of construction and manufacturing grew by 9.2 percent compared with 8.5 percent in 2006. Whereas in 2007, the construction industry contributed 7.9 percent to the country’s Gross Domestic Product (GDP), this is an increase of over 2 percent compared with 5.8 percent in 2006.

A Quarry material is the main cement raw material whose component constitutes 70 percent of cement product. Normally this is excavated from a nearby cement plant

The continued growth in the industry corresponds with the increased cement demand and production in the country. The industry estimates that 90 percent of cement consumption is used for residential purposes, the majority of which is for the construction of new buildings. Tanzania consumes an average of 42 kilos per capita per year of the cement production in the country. These statistics serve as an indicator of the economic activity in the country which indicates a substantial room for growth. According to the latest cement industry report, the usage of cement product in the country, has increased substantially as the demand of the product is high. Cement manufacturers have seen the need to increase their production level to meet the national demand as the product is the cornerstone of the construction industry as a whole.
The volume of cement required in construction are substantial. On average, the construction of a family home requires 14 tones of cement, whereas a kilometer of road contains as much as 2,500 tons of cement. In 2007, the total amount of income generated in the Tanzanian economy by the cement industry is Tsh 199 billion, Tsh. 90 billion of which went directly or indirectly to the government. Comparing the total benefits generated for the stakeholders to the total revenues generated, the government made 1.5 times the amount of money from the sale of a bag of cement than the stakeholders of the companies did themselves. In the Tanzanian cement industry, the majority of the production is contained in the 50kg bags of cement. This cement is used either for making blocks or concrete which are then used for a variety of purposes that includes the following. Residential buildings, commercial offices, manufacturing and mining facilities, roads and bridges, water and sewerage treatment facilities, harbours and reservoirs. Infrastructure made with cement has a number of benefits such as newly constructed roads and those which are under repair which allow for reduced travel time. Residential structures built with cement products have a longer lifespan for they provide more security and more soundproof and fireproof and have better temperature control than homes built with other products. Buildings made of concrete need less energy for heating and cooling than those made of other materials. Cement is an excellent insulator and concrete buildings remain cooler in the heat and warmer in the cold.

Construction workers in a newly constructed cement plant at Wazo Hill on the outskirts of Dar es Salaam city. A multi-billion plant factory is owned by Tanzania Portland Cement Company, the largest in the country.

Under corporate social investments, the cement industry is committed to sustainable development in Tanzania and plays the leading role in contributing to health, education, environment and community development programs. In 2007 alone, the industry spent Tsh. 436 million on such programs and initiatives. Highlights of the recently funded programs includes education which involves the construction and renovating classrooms in various parts of the country. Under the education sector, the cement companies has extensively rehabilitated schools, and provided them with the necessary facilities such as water management and sewage systems, toilets, desks and teachers’ tables. They have also provided founding sensitization training to school on HIV and malaria issues.
Under community development issues, the cement companies supports existing NGOs and organizations such as a community development programme which deals with orphanage and youth counseling centers in both Tanzania Mainland and Tanzania Isles.
The companies support NGOs that address HIV/AIDS and cancer problems, thus donating food and other basic needy products to orphans in the city of Dar es Salaam. In addition to that, these companies engage in water supply wherever there is scarcity and this is supplied free of charge to villages neighboring the integrated cement factories. Human capital investment has a large multiplier effect where skills shortages and inadequate capacity constrain the development of industries. Tanzanian cement industry supports human capital development through training and development. All cement companies provide training to employees both on and off site and most of their training is related to production, technology and maintenance, but other examples of training include issues pertaining to labour laws, civil engineering, quality control and information technology. Language courses for English and Kiswahili are also offered because all three cement companies are subsidiaries of larger international corporations, they take full advantage of the training centres and courses offered worldwide.

Cement bags in final stage of transportation at the habour.

The three companies sends employees abroad for training on secondment programs. In 2007 alone, the industry spent over Tsh. 575 millions on training programmes benefiting almost every employee. According to statistics made available, in all three companies 98 percent of the employees are local. The industry provides extensive safety, training and equipment to their employees. Each company does provide full medical services to all employees, including on site clinics and ambulances. The industry has a number of safety and hazard standards in place to protect its employees. Tackling HIV/AIDS has become a major responsibility for the industry by offering counseling programs, free ARV treatments to employees and free voluntary HIV testing. The industry has peer educators who hold weekly meetings to provide training and support to employees and their families. The industry has taken additional measures that shows its investments in employees’ well-being. They provide fully subsidized transport to from work as well as canteen facilities to all employees. They provide housing, education allowances and medical treatment for employees and their dependants. Tanzania has three major cement manufacturing companies who are also members of East African Cement Producers Association (EACPA). The association incorporates all eight giant cement companies which currently operates in East Africa region. The role of association is to coordinate among its members the exchange of information pertaining to cement technology, environment and product standards to enhance the competitiveness of the cement sector within East African Community market. The EACPA-Tanzania chapter is composed of three independent and competing companies, these are Tanzania Portland Cement Company Ltd (TPCC) also known as Twiga cement. The company was established in 1966 and its major stakeholders is HeidelBerg Cement and its quarry factory offices are located in Wazo Hill area on the outskirts of Dar es Salaam city. The firm is publicly listed on Dar es Salaam Stock Exchange. Tanga Cement, also known as Simba Cement, opened its factory in 1980 in Pongwe are in Tanga municipality. Holcim Mauritius Investments Holding is the major stakeholder and the company is listed on the Dar es Salaam Stock Exchange. The third cement company is Mbeya Cement company Ltd, this is a member of the Lafarge group and opened in 1983 in Songwe, South of Mbeya town. The company is currently not publicly listed.